🇨🇭 France Hosts the G7. Switzerland Pays for It.
A masterclass in outsourcing the awkward parts of being a great power.
Look at a map of Lake Geneva. The 52nd G7 is meeting in Évian from June 15 to 17. Évian is in France, technically. Geographically, it’s basically Switzerland with a casino and a spa attached. The lake is a French problem on one shore and a Swiss problem on the other, and France has decided that the Swiss shore is, for security purposes, also going to be a Swiss problem. Macron is hosting his last G7 in a town of 9,300 people whose biggest export is bottled water and whose Hôtel Royal hasn’t seen this kind of traffic since Bush, Chirac and the rest of the gang rolled through in 2003.
Here’s the trick. France gets the photos. France gets Macron at the head of the table with Trump, Modi, Lula, Takaichi, the whole lineup. France gets a communiqué stamped « Évian, June 17 » that nobody will read. Switzerland gets the protesters. France has, conspicuously, not bothered to designate a protest zone on its own territory, which is a polite way of saying France would prefer the demonstrators take their grievances to Geneva. Which they will. Geneva is not in the G7. Geneva has nothing to do with the G7. Geneva just happens to have public squares, TV cameras, shop windows, and the misfortune of sitting 40 minutes from Évian.
The Federal Council has classified the situation « exceptional, » which in Swiss bureaucratese means: Bern eats 80% of the cantonal and police costs. Up to 5,000 troops can be deployed. The airspace over Geneva, Lausanne and Évian shuts from June 10 to June 18. The cantons of Geneva, Vaud and Valais get to decide whether to filter their own borders. (Pascal Couchepin, who ran the equivalent gig in 2003, was asked whether France was sticking Switzerland with the bill. His answer: « France is sovereign. It organizes the summits it wants where it wants. » This is the most elegantly polite « yes » I have read all year.)
And yet, of course, Switzerland is going to handle it. The army will deploy. The cantons will coordinate. The hotels will fill up with delegations from Brazil, India, South Korea and Kenya, all of whom are sleeping on the Swiss side because the Swiss side has hotels and the French side has Évian. The whole thing is absurd in a very specific French way: get the photo, dump the logistics on the neighbor, send Macron over for dinner. Switzerland doesn’t host G7 summits. It hosts the people who hosted the G7 summit. Smaller bill. Stronger currency. No broken windows on the invoice.
Have a great week!
M. Hantale 🧀
- 🇺🇸 Diplomacy. Trump rejects Iran’s new peace offer as international talks loom over the Strait of Hormuz.
- 🇷🇺 Conflict. Putin believes the war in Ukraine is coming to an end, whilst criticising Western support for Zelensky.
- 🇬🇧 Defence. Paris and London are bringing together around forty ministers on Tuesday to coordinate a military mission aimed at securing the Strait of Hormuz.
- 🇨🇭 Diplomacy. Switzerland’s Foreign Minister describes the conclusion of strategic agreements with the EU as « indispensable » to guarantee stability and prosperity.
- 🇨🇭 Health. A patient suffering from hantavirus is being treated at Zurich University Hospital, with Swiss authorities assessing the risk to the population as low.
Economy & Finance
- 🇨🇭 Inflation. Annual inflation in Switzerland doubled to 0.6% in April, driven by rising energy prices.
- 🇪🇺 Growth. The head of UBS has warned of economic stagnation in Europe, pointing to a widening divergence with the United States and Asia linked to over-regulation.
- 🇺🇸 Growth. The US services PMI index fell to 51 in April 2026, below market expectations.
- 🇨🇭 Employment. Switzerland’s unemployment rate falls to 3.0% in April, confirming labour market resilience despite international uncertainty.
- 🇪🇺 Employment. The European reform of unemployment insurance for cross-border workers could cost Switzerland 600 to 900 million Swiss francs per year, according to SECO.
- 🇫🇷 Deficit. France’s budget deficit reaches €42.9bn at end of March, down slightly compared to last year.
- 🇨🇭 Industry. Air traffic at Zurich airport exceeded its pre-Covid level for the first time in 2026 on a monthly basis, despite regional tensions.
- 🇩🇪 Industry. German industrial production fell unexpectedly in March, signalling a slowdown in the manufacturing sector.
- 🇨🇭 Raw materials. A « very high » risk of fuel shortage in Switzerland is raised by Suissenégoce, as global strategic reserves dwindle and oil prices exceed $125 per barrel.
- 🇪🇺 Raw materials. The ECB warns of Europe’s dependence, which imports 60% of its energy, predominantly fossil fuels.
- 🇺🇸 Trade. American courts have invalidated the new temporary 10% tariffs imposed by Trump, a setback for his global tariff strategy.
Switzerland
- 🇨🇭 Health. The number of subscribers to Swiss fitness centres reaches a record with 1.45 million members, or one in five adults.
- 🇨🇭 Employment. The healthcare sector displays the highest rate of professional satisfaction in Switzerland, with 8 out of 10 employees declaring that they practise a meaningful profession.
- 🇨🇭 Mobility. Lausanne’s m2 metro will be modernised thanks to a 295M€ contract with Alstom including CBTC signalling and the refurbishment of existing trains.
- 🇨🇭 Mobility. A helicopter carrying six people crashed in Mezzovico-Vira in Ticino, resulting in one seriously injured person and five people with minor to moderate injuries.
- 🇨🇭 Innovation. Lugano is pursuing its Plan B to become the « European capital of cryptocurrencies », despite still limited economic returns four years after its launch.
- 🇨🇭 Climate. The major Lake Geneva clean-up operation collected 2.6 tonnes of waste, including 36,600 cigarette butts.
- 🇨🇭 Culture. American filmmaker Darren Aronofsky will receive the Honorary Leopard at the Locarno Film Festival on 14 August.
- 🇨🇭 Defence. The Swiss Army is participating in NATO’s multinational exercise « Tiger Meet » in Greece with five F/A-18s until 15 May.
- 🇨🇭 Diplomacy. Swiss president Guy Parmelin met Pope Leo XIV at the Vatican to discuss the project for new Swiss Guard barracks, ahead of the 500th anniversary of the sack of Rome.
- 🇨🇭 Politics. The first SSR poll on the « No Switzerland at 10 million » initiative shows 47% voting intentions in favour and 47% against, with the outcome remaining entirely uncertain one month before the ballot.
Elsewhere in the World
- 🇩🇰 Government. Mette Frederiksen has failed to form a coalition in Denmark, a new liberal negotiator has been tasked with attempting to break the deadlock.
- 🇭🇺 Government. Tamás Sulyok has been sworn in as Hungary’s new Prime Minister, promising changes.
- 🇨🇷 Government. Laura Fernandez, elected on a hardline stance against drug trafficking, has been sworn in as president of Costa Rica, whilst her mentor Rodrigo Chaves takes the strategic post of « super-minister » despite corruption investigations.
- 🇵🇱 Justice. Former Polish Justice Minister Zbigniew Ziobro, who is the subject of an investigation into abuse of power, has left Hungary, where he had been granted asylum, to take refuge in the United States.
- 🇨🇳 Justice. Two former Defence Ministers have been sentenced to death with a reprieve for corruption, a sign of an unprecedented purge in the Chinese military since the 1970s.
- 🇹🇭 Justice. Former Prime Minister Thaksin Shinawatra has been released from prison following a sentence reduction for good behaviour.
- 🇬🇧 Politics. Despite a historic setback in the regional elections, Keir Starmer remains Prime Minister without internal challenge.
- 🇷🇺 Politics. The Kremlin is drastically strengthening security around Vladimir Putin, who is now limiting his movements due to fears of attacks and coup attempts.
- 🇨🇩 Politics. In the DRC, President Félix Tshisekedi is showing himself ready to circumvent the Constitution to remain in power beyond the two-term limit.
- 🇮🇷 Rights. Nobel Peace Prize laureate Narges Mohammadi, detained in Iran, has been hospitalised as an emergency and her relatives fear for her life.
- 🇳🇱 Security. A homemade bomb targeted the D66 party’s premises in The Hague, causing no casualties but sparking outrage from the Prime Minister.
- 🇲🇱 Security. More than 30 people were killed in two jihadist attacks claimed in central Mali, marking a fresh escalation of violence.
- 🇹🇩 Security. A Boko Haram attack against a military base in Chad has killed at least 24 people according to authorities.
- 🇨🇭 Pharma. ALP Bio raises €1.9M to accelerate the development of its platform combining human immune organoids and AI.
- 🇩🇪 Pharma. Novartis will close its Wehr production site by 2028, eliminating 220 jobs in Germany.
- 🇨🇭 Insurance. Swiss Re posts net profit up 19% to $1.5bn in Q1 2026, despite a 4% decline in insurance revenues.
- 🇨🇭 Transport. SWISS posts an operating profit of CHF 30m in the first quarter, driven by increased demand linked to the Middle East conflict.
- 🇺🇸 M&A. Roche acquires American firm PathAI for $750m to strengthen its AI-based diagnostic solutions.
- 🇨🇭 Food and beverage. Nestlé confirms the maintenance of Nespresso capsule production in Switzerland despite American tariffs.
- 🇨🇭 Technology. Mosaic SoC raises €3.2M in pre-seed funding to develop spatially intelligent, low-power perception chips.
SMI Index
| Name | Price | Mkt Cap | 7d Chg | YTD |
|---|---|---|---|---|
| Nestlé | 77.47 | – | ▼ -0.90% | ▲ +5.49% |
| Novartis | 113.36 | – | ▼ -0.42% | ▲ +7.66% |
| Roche | 322.30 | – | ▲ +1.83% | ▲ +2.05% |
| UBS | 35.03 | – | ▲ +2.37% | ▼ -5.17% |
| Zurich Insurance | 540.40 | – | ▲ 0.00% | ▼ -4.87% |
| ABB | 82.02 | – | ▲ +4.59% | ▲ +35.91% |
| Sika | 144.20 | – | ▲ +1.19% | ▼ -9.40% |
| Lonza | 483.00 | – | ▲ +0.79% | ▼ -9.82% |
| Geberit | 524.00 | – | ▲ +0.73% | ▼ -12.86% |
| Swiss Life | 879.40 | – | ▲ +1.38% | ▼ -1.58% |
| Partners Group | 882.00 | – | ▲ +1.45% | ▼ -14.37% |
| Givaudan | 2,779.00 | – | ▲ +0.62% | ▼ -8.06% |
| Swisscom | 669.50 | – | ▲ +1.44% | ▲ +20.12% |
| Swiss Re | 123.45 | – | ▼ -1.52% | ▲ +0.91% |
| Holcim | 74.30 | – | ▲ +5.00% | ▼ -4.91% |
| Julius Bär | 66.64 | – | ▲ +4.52% | ▲ +5.72% |
| Alcon | 49.17 | – | ▼ -14.69% | ▼ -22.24% |
| SGS | 84.48 | – | ▲ +0.07% | ▼ -5.64% |
| Logitech | 84.30 | – | ▲ +6.95% | ▲ +6.06% |
| Straumann | 84.74 | – | ▲ +0.02% | ▼ -9.14% |
📅 Data as of 2026-05-11 08:06
Forex CHF
| Pair | Rate | 7d Chg | YTD |
|---|---|---|---|
| EUR/CHF | 0.92 | ▼ -0.11% | ▼ -1.62% |
| USD/CHF | 0.78 | ▼ -0.61% | ▼ -1.62% |
| GBP/CHF | 1.06 | ▼ -0.19% | ▼ -0.78% |
📅 Data as of 2026-05-11 08:06
The Vintage Problem
The private credit panic is, at root, a vintage problem. Loans written in 2020 and 2021, when SOFR sat at 25 basis points and software was treated as a savings account with extra steps, are now refinancing into a world where SOFR has touched 525, AI is hollowing out mid-market codebases, and PE sponsors have run out of patience. The loans written more recently look fine. The loans written then do not. Strip away the cockroach metaphors, the dividend cuts, the redemption queues, and that is the story.
$93B to $644B. North American direct lending grew that much in ten years, a sevenfold expansion driven mostly by capital that had nowhere else to be. Public BDCs now trade at 0.83x NAV, the widest discount since the 2020 crash. They are down roughly 20% YTD against a 1% decline in their reported loan values. The market is not buying the marks.
On September 25, one mid-cap software loan was carried at par. By Halloween, it was at zero. BlackRock’s TCP Capital wrote down NAV by 19% in a single quarter. Saba Capital is now offering to buy private credit fund stakes at discounts of 20% to 35% to stated NAV. When a hedge fund opens a market in your marks, your marks have a problem. Non-traded BDCs raised after 2021, with cleaner-vintage books, are showing none of this. Vintage, again.
$38B in private credit AUM. €8.5B placed across 117 senior direct loans in Europe, targeting mid-market companies in the €20M to €50M EBITDA range, with conservative leverage and visible cash flows. Partners Group, headquartered in Zug, has been doing the work quietly. Its evergreen private credit fund returned 9% net last year. No NAV writedown headlines. The Zug edge this cycle is having been late: ZIRP was a phase to outlast, not ride.
Behind that single firm sits a wider institutional posture. CHF1,066B across 1,353 Swiss pension funds. Average coverage ratio above 115%. They do not need to chase yield to make the actuarial math work. Fixed income still sits near 31% of the average allocation, private debt is a slight overweight at most, and the marginal capital in 2025 went mostly to infrastructure. The Anglo model dialed down bonds, dialed up software-heavy direct lending, and is now living with a 17% NAV discount. The Swiss model kept its bonds, added power grids, and let the cycle do its work elsewhere.
Capital that has to deploy will deploy badly. Capital that does not, will not. The American managers who built a $450B BDC industry on retail flow and pandemic-era margins are now learning what their marks were worth. Switzerland’s allocators, sitting on funded ratios that do not need rescuing, can afford to watch. The next two years will sort the disciplined from the merely fortunate. Quiet books age better than loud ones. That, in this market, is the entire trade.